A cadre of some of the most powerful trade unions in the world have banded together to take a stand to fight against aggressive tax avoidance.
Trade unions are some pretty powerful entities in their own right. For what it’s worth, these unions have some bloody deep pockets – and some truly massive pension funds as well. In order to avoid getting collared by tax avoidance schemes, these unions have put the word out that they plan to only invest their pension funds into valid investments – and to improve their own tax practices to boot.
The new edicts come down just in time if you ask me, especially considering how it wasn’t so long ago that the Luxembourg secret tax deal scandal broke, revealing how countless asset management companies, pension funds and large multinationals were engaged in some rather dodgy practices. In response more than 40 rather irate trade unions, which included union heavyweight AFL-CIO, demanded that any pension funds for union members be on the up and up and not fall into any tax avoidance or tax evasion loopholes.
To be quite honest there’s already a damning list of public and private funds that were caught with their hand in Luxembourg’s cookie jar. The National Pension Service of Korea and the Public Sector Pension Scheme Board of Canada were named in the documents, as were the asset management arm of BNP and other fund management firms like Schroders, Henderson and Fidelity.
For what it’s worth, I know that individuals that have cash ferreted away in these pension funds have very little say into where their money goes. That’s why it’s so important for these trade unions to dictate terms for their pension funds on behalf of their members, and I for one am all for these tougher restrictions as demanded by unions.
Exposing unions to tax liabilities just because you’re in search of the biggest bang for your buck is not only immoral – it’s bloody illegal. These funds need to pay their taxes accurately and fully in order to provide tax collectors the revenue they need to not go after smaller-scale businesses like contractors and other self-employed individuals, who already bear the brunt of taxation in all too many markets.